Experts were yesterday analysing the fall-out from the collapse of Connaught — with 10,000 jobs on the line and a £220million debt mountain likely to impact upon Westcountry firms within the supply chain.

Yesterday, Richard Heis, Richard Hill and Richard Fleming of KPMG were appointed joint administrators to Connaught plc.

Administrators from the insolvency specialist were also appointed to Connaught Partnerships Limited, which employs around 500 staff in the South West, and to a smaller company in the Partnerships business: Connaught Technical Solutions Limited.

The administrators said that they were “hopeful” that the majority of staff will be transferred to alternative providers. Decisions regarding redundancies will be announced “as soon as possible”.

Connaught Partnerships is one of three main businesses operating within Connaught’s building services group.

The others, Connaught Environmental and Connaught Compliance are not in administration and will be sold on by administrators as fully operational companies.

A weeding-out of Connaught’s assets will now begin to ascertain the value of around 180 UK-wide maintenance contracts with potential to be sold on.

There have been rumours that Connaught secured some tenders by undercutting the market with so-called “suicide contracts,” based on quotes too low to be profitable, but hedging upon additional emergency repair works for the client to bolster revenue.

“No doubt there will be some profitable contracts and they will be sold on,” said Ian Walker, South West regional managing partner at insolvency firm Begbies Traynor.

Exeter-based Rok said that it had already been approached with enquiries from potential clients, boosting hopes in the region that Connaught’s 700 or so employees will be able to find employment from companies picking up on its viable service and maintenance contracts.

A company spokesman said: “Rok, like many others in the sector, has been approached in recent weeks.

“In Devon, our teams have been working to see how they can help such customers but it is too early to say how much business will come to us as a result.”

Social housing group Plymouth Community Homes, which recently awarded a £24.5 million five-year maintenance deal to Connaught, is among former clients now actively seeking an alternative contractor.

Chief executive Clive Turner added that the housing association had only paid Connaught on completion of jobs.

Malcolm Colegate, Devon regional chairman of the Federation of Small Businesses said: “This is going to affect a lot of small businesses in the supply chain. Coming at the time of a double dip recession won’t help and is the last thing we needed. It’s obviously going to have a major impact upon the labour market.

“One upside could be that local authorities and housing associations are encouraged to use a number of local firms, leaving leaves them less exposed to this sort of impact, if one company goes down.”